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‘People are more inclined towards fixed income investments’: GoldenPi

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Rahul embarked on his personal finance journey early in life. By the age of 27, the interior designer was ecstatic about making high returns from his investment in equities. The market was doing well, and accordingly, he had planned for his personal commitments. But the bull run didn’t last too long for Rahul. The global uncertainties have led to a major downward spiral in the early part of 2022, with no respite even now. Rahul incurred huge losses and decided to pull out all his wealth and deploy it in options that are more secured and not linked with equity markets. It also made him realize the importance of diversifying his investment portfolio.

“With that in mind, I started exploring options in the fixed income investment space, which is when I stumbled upon GoldenPi. This online platform is entirely dedicated to making fixed-income investments easily accessible to millions of retail investors such as myself. Given how volatile the equity market is, investing in fixed income tools is a secure and wiser option,” Rahul said.

Rahul’s sentiments are increasingly being echoed by a majority of investors across India. Many retail investors between the age group 20 to 35 are now showing a keen interest in investing in the fixed income space. “We definitely see a huge amount of interest among retail investors towards bonds and debentures. In AAA-rated bonds, an investor can get returns between 8 to 8.5 percent, while for AA-rated bonds, the yield will be around 9% and for A-rated bonds, 10% and above,” says Abhijit Roy, CEO, and Co-founder, GoldenPi.

As India’s first and leading aggregate platform for investing in bonds and debentures, GoldenPi currently has a user base of 2.5 lakh investors. The online platform features a daily inventory of Rs 5,000 crore, with a minimum investment amount of Rs 10,000 per investor.

“Given the current volatility in the equity market, people are more inclined towards investing in fixed income instruments,” notes the entrepreneur who recommends making informed investment decisions at an early age. Starting to invest when you’re younger gives you the advantage of time. “Once an individual starts earning money and can take care of his/her life’s needs, with some surplus money left in hand, s/he should start their investment journey. Putting that small amount into an investment at an early age makes a lot of difference,” he says.

Suppose someone starts investing Rs 5,000 per month at the age of 24, the corpus will be Rs 20.50 lakh (assuming an 8% rate of return) when the person reaches 40. If the same person were to start investing Rs 5,000 per month at the age of 30, the corpus would be Rs 13 lakh (assuming the same rate of return) when he reaches 40. “The person starting early gets a 1.6X multiple on his savings as compared to the one who starts late. So, the sooner you start investing, the greater the amount of corpus that you are able to build,” explains Roy.

Besides, one also has to be financially prepared for contingencies later in life, on personal and professional fronts. “For instance, if a layoff happens (which is happening in the market), you have got the capital that provides you an ample amount of cushion to wade through the situation while you are searching for the next job. It’s important to build up a corpus for handling any kind of adverse event in life,” he adds.

When it comes to financial investments, it is important to understand the relationship between risk and returns. “Equity is a high-risk, high-return game. As we have witnessed in the recent past, the equity market is very volatile. So, at the end of the day, young investors tend to lose out on capital. Currently, many people have their portfolios in red. If they have to sell at a loss, this will basically turn into capital erosion for them,” warns Roy.

It’s prudent to diversify assets for a balanced portfolio. Consider splitting the investment across equity and fixed income, rather than parking all the money in one asset class. That way, you are neither exposed to excessive risk nor too low returns.

Although fixed income investment tools such as bonds and debentures offer more lucrative options than traditional FDs and RDs, there is only a section of the society that is aware of this fact, notes Roy. GoldenPi aims to create better awareness, particularly among young retail investors like Rahul who are seeking fixedincome investments that yield higher returns.

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